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London – the right fit for Ukrainian companies looking for growth capital Jon Edwards and Zarina Korolova, London Stock Exchange, June 2008 London is the place for international companies looking for capital London provides CIS companies with an established peer group

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london the right fit for ukrainian companies looking for growth capital

London – the right fit for Ukrainian companies looking for growth capital

Jon Edwards and Zarina Korolova,

London Stock Exchange,

June 2008

slide3

London provides CIS companies with an established peer group

  • Over 100 CIS companies trading in London
  • 90% of International Order Book trading in 2008 YTD is CIS
  • $22 billion raised by CIS companies in London last year at IPO
  • Strong appetite for fast growth mid-cap companies from the CIS in London - over $ 1.7 billion raised to date by CIS companies on AIM at IPO
  • Average IOB daily trading volume is 2.3 billion
slide5

Main Market &AIM

Main Market

Supports the capital raising activities of earlier stage companies

Supports the capital raising activities of more established companies

1,675 companies: Aisi Realty Public, Dragon Ukrainian Properties & Development, KDD Group, Landkom, Nostra Terra Oil and Gas, Regal Petroleum, Ukrproduct, XXI Century

1,550 companies: Ferrexpo, JKX Oil and Gas, MHP, Ukraine Opportunity Trust

slide7

CIS companies on AIM

  • 49 CIS AIM Companies (including 25 Russian, 12 Kazakh, 8 Ukrainian, 1 Kirghiz)
  • In 2007, CIS AIM companies raised £662m at IPO
  • In 2007, CIS AIM companies raised £577m in further issues
  • AIM investors have backed CIS companies in a number of sectors including oil & gas, mining, telecommunications, media, food & drink, property, construction and chemicals
slide8

AIM companies by market capitalisation

CIS Average Market Cap vs. AIM Average Market Cap (£,m)

The average for CIS AIM companies at admission is £98m.

Source: London Stock Exchange Statistics

market cap growth since admission to aim

Ukrainian AIM Companies Case Study

Market Cap Growth since Admission to AIM

11/02/06

$6m

27/09/02

$10m

01/08/07

$17m

Date of adm

Money Raised

16/12/05

$68m

01/06/07

$104m

22/11/07

$54m

slide10

Fundraising on AIM

AIM Money Raised (£m)

In 2007 the average IPO raise for AIM Companies was £36m and the average further raise was £4m

Source: London Stock Exchange Statistics, June 2008

slide11

Fundraising on AIM – case study

£4m

£9m

£10m

£5m

£2.5m

Hambledon Mining has grown its market cap from 10 million GBP

at Admission to 50 million GBP today

slide12

IPO Process

Legal reports and negotiations

Cost Structure (AIM)

Law Firm

Law Firm

Total costs to raise £50m,

Excluding value of options:

(

NOMAD’s

)

(Corporate)

£2,500K

-

£5,000K

5%

-

10%

Overall costs range:

£150K

-

£300K,

Of which

NOMAD’s

£150K

-

£200K

Prospectus

Lawyers get 25%

-

40%

plus

Short

-

form

1% of the firm

Preparation

report

NOMAD

Reporting

Company

Accountants

Underwriting and

£100K

-

£150K

Technology

analytical coverage

Experts

Broker

3

-

5% of

£25K

-

£50K

£10K

the deal, plus

1% of the firm

Listing and trading Services

Public Relations and

Investor Relations

Stock Exchange:AIM

Independent

PR firms

Researchers

LHC

CREST Co

Registrar

AIM IPO Costs Overview

Source: Oxford Said Business School MBA Project, August 2006 as amended by London Stock Exchange

contacts
Contacts
  • Jon Edwards
  • Senior Manager, CIS & CEE
  • jedwards@londonstockexchange.com
  • +44 20 7797 1599
  • Zarina Korolova
  • Manager, CIS & CEE
  • zkorolova@londonstockexchange.com
  • +44 20 7797 4472